Newton's 3rd Law of Motion

In middle school / junior high, we all learned about Newton's 3rd Law of Motion: Law of Reciprocal Actions. That may not sound familiar at first. But the layman's explanation you will surely know - for every action there is an opposite and equal reaction. This law is usually applied to physics, but it can really be applied to anything, such as economics and politics.

Unfortunately, politicians forget about this law. Instead, they pass these Earth-shattering and life-altering laws that are designed to help and protect us without an ounce of thought about the consequences of their actions. Instead, they often make the situations worse. Let's take the new Credit Card Reform Bill, sponsored by Chris Dodd (D) of Connecticut (the same guy who was outraged that banks were using stimulus money to pay bonuses until someone pointed out that he was the one included language that allowed them to use stimulus money to pay bonuses). The bill was passed by the Senate and is expected to be signed by President Obama this week.

The Credit Card Reform Bill, known to most people as the Congressional Attempt to Protect Idiots Who Don't Pay Their Credit Card Bill, has the intention of protecting the people who suck at paying their bills and from having their interest rates raised retroactively or raised without notice, or having credit limits lowered without reason or without notification. The Congress is always out to protect the people that are too stupid to protect themselves and act responsibly. To a degree this is probably needed. But on the other hand, why do idiots have credit cards in the first place?

So continuing with our theme, Congress' new bill is the action. What is the reaction? If you ask supporters of the bill, like Maryland's Barbara Mikulski, she will tell you, "there ain't no reaction cuz dis bill s'ports 'n pertects Merlin' citizens from greedy Wall Street linders." However, if you ask banks and lending institutions that issue credit cards, you will get another story.

If Congress is removing a revenue source from these companies, will they roll over and accept this goverment meddling in their business? Or will their shareholders punish them unless they take actions to generate new sources of revenue? Well, duh! Like a Baltimore crack dealer who's territory gets demolished by a Johns Hopkins neighborhood revitalization program, they're going to find new source of income.

Where will this new revenue be found? By the customers who are not protected by the Credit Card Idiocy Bill - the ones that pay every month. Gone will be the cards with no annual fees. In will be cards that begin charging interest immediately upon purchase. In will be fees for paying off your balance in-full. Gone will be the perks and rewards programs that they used to lure you to use their cards.

But this isn't fair, you say! I pay my bills every month and now I'm being punished? That's right. Because Congress has to protect the idiots, not the smart and responsible people. Perhaps you can learn to be an idiot and Congress will protect you, too!